Monat: März 2018

Nearly 16.3 million Americans, or 8 percent of the country, own some form of cryptocurrency, according to a new survey by Finder.com, which also found slightly more than 5 percent of Americans owned Bitcoin. If accurate, the results mark an increase from

Robomarkets, a brokerage that operates in the European markets, has added access to trading CFDs based on cryptocurrencies for its clients. Some of the most popular cryptocurrencies such as bitcoin, bitcoin cash, dash, ethereum, litecoin, and ripple, have been added to the list of available trading instruments.

24/7 Trading

Robomarkets offices in Cyprus

Robomarkets, a Cyprus Securities and Exchange Commission (CYSEC) registered investment company, has announced that the following CFDs (contracts-for-difference) are now available to its clients: BTC/USD, ETH/USD, BCH/USD, DASH/USD, LTCUSD, and XRP/USD. With a maximum admissible leverage of 1:5, the above-mentioned instruments may be traded on the Metatrader 4, MetaTrader 5 and Webtrader platforms as well as on the company’s own R Trader terminals. In addition to that, the R Trader platform now offers clients with an option to buy cryptocurrencies without swaps (overnight fees common in FX) with a leverage value of 1:1.

Introducing the new concept to its clients, the company explained that unlike the trading instruments most CFD traders are used to, cryptocurrencies may be traded 24/7, including on the weekends when fiat currency pairs, commodities and stocks are not available for live trading operations. The brokerage says that this factor provides traders with an opportunity to use more trading strategies, which require some extra time to add to a usual business week.

Screenshot of BCH on R Trader terminal

Keeping Up With the Times

Konstantin Rashap, the company’s development manager in Europe commented: “RoboMarkets always keeps up with the times and implements cutting-edge technological solutions. Continuing our expansion on the European market, we’re pleased to offer our clients a new class of trading assets. By adding cryptocurrencies to the list of more than 8,700 instruments that are already available to RoboMarkets clients for trading, we’re not only responding to their demands, but also systematically expanding the list of our services and improving their quality.”

The European brokerage’s international sister company Roboforex first launched bitcoin and ethereum trading back in September 2017. The Belize-licensed firm also added CFDs based on bitcoin cash, dash, litecoin, and Ripple’s XRP earlier this year.

Is the promise of 24/7 trading a good way to get CFD traders excited about cryptocurrencies? Share your thoughts in the comments section below!

Images courtesy of Shutterstock.

Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.

Crypto whales are generally thought of as wealthy traders with the ability to move markets via a single sell order. Yet the greatest whales of all aren’t traders but ICOs which own millions of ether worth billions of dollars. Over 3% of the total ethereum supply is estimated to be in the hands of ICOs, and when those projects cash out, as periodically happens, the effects can be dramatic.

Ethereum Is at the Mercy of ICOs Cashing Out

On Sunday, while the crypto markets were enduring yet more turmoil, ethereum took a sudden nosedive, going from $516 to $464 in under two hours. Up until then, it had been one of the more stable coins compared to alts still in the experimental stage, which have absorbed the worst of the losses. Ethereum’s flash drop made it one of the worst performers in the cryptocurrency top 100 yesterday, shaving around 16% off its valuation. The cause of the sell-off has been attributed to one of last year’s ICOs offloading a significant portion of its ethereum reserves. If so, it’s not the first time something like this has happened, and it certainly won’t be the last.

Deducing the total amount of ethereum that has been invested in ICOs is relatively straightforward. Around two thirds of the $5.7 billion raised by crowdsales in 2017 was in the form of ether. These projects are obliged to sporadically cash out their holdings for fiat currency, to cover expenses that can’t be paid in crypto. And when they do, it makes sense for those projects to withdraw a lump sum. What’s good for them isn’t necessarily good for the market though, especially traders whose longs are rekt by a sudden dump of ETH.

Fear of the Whale

Cryptocurrency markets are much less liquid than traditional financial markets. When hundreds of thousands of ether is sold on the open market, typically via an exchange such as Bitfinex or Kraken, it will instantly depress prices. Traders, ever alert to even the slightest signs of market movement, are skittish creatures, and even the possibility of a coming dump can be a case for concern, as evidenced by the recent fears over the Mt Gox whale dumping BTC en masse – even though those fears have since been assuaged.

12 hours before ethereum dropped on Sunday, EOS moved 50,000 ETH to a Bitfinex address. It is impossible to determine when an entity sells the funds they have moved to a cryptocurrency exchange; the deposit only indicates intent to sell. The contribution addresses of major ICOs are monitored by discerning traders, however, and thus when a crowdsale transfers ETH to an exchange, it can become a self-fulfilling prophecy that serves to deflate prices.

At Least 3.4% of All ETH Is Locked Up in ICOs

One crypto trader professes to have seen figures showing that 3.4% of all ETH, or around 3.4 billion coins, are in the possession of ICOs. When these projects have bills to pay, or fear that the market is likely to deflate further, they feel obligated to cash out. These whales are under no obligation to sell OTC; using a trusted exchange is generally the preferred route. All of this creates downward pressure on ethereum on a scale far higher than that faced by any other crypto asset.

For so long as ethereum remains the preferred fundraising platform for ICOs, the cryptocurrency will remain concentrated in the hands of 100 or so projects, each with the power to offload on the market at any time. In each instance, the market will recover, but not before some traders, especially those using leverage, have absorbed heavy losses. Every cloud has a silver lining though, and when major dumpage occurs, it’s a prime opportunity for other traders to scoop up cheap coins before the price rebounds.

Do you think ethereum is hostage to the large amounts of coins in the possession of ICO whales? Let us know in the comments section below.

Images courtesy of Shutterstock and Coincodex.

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The UK’s CMC Markets Plc announced it would offer cryptocurrency contracts for difference (CFDs) and spread-betting, accessible at first to professional traders. Though too soon to call a trend, the company is following its rivals into an unsure market increasingly under threat from regulators.

More Crypto CFDs Added Due to Demand

Grant Foley

“With the cryptocurrency market growing rapidly over the past ‎‎12 months,” CMC’s Grant Foley explained, “we have received significant interest from our clients for bitcoin ‎and ethereum CFDs. As a result, we have developed a new offering for this ‎unique digital asset class. We recognise that cryptocurrencies can be ‎regarded as a volatile market, so we are initially only offering trading, on an ‎exclusive basis, to our experienced professional client base.”

Based in London, CMC Markets Plc is owned by Goldman Sachs. ‎It’s a worldwide market maker, and trades in contracts for difference, foreign exchange, and spread-betting. Spread-betting is a very British financial speculation similar to derivatives, and can be offered in parallel to CFDs. Its advantages include flexibility in trading hours, potential for innovation, and it usually has stop losses baked-in. Spread-betting is a contract between the market-maker and the client, not cleared by an exchange, and can avoid many regulations in doing so.

CFCs are financial derivatives. Traders take long or short positions on price without the bother of owning the actual asset – in this case, cryptocurrencies like bitcoin. They come in the form of indices, stocks, futures, bonds, commodities, or currencies. CMC for its part is entering crypto after rivals Admiral Markets, Gain Capital’s City Index, Plus500 Ltd., and IG Group Holdings Plc. have already proved the market can be made.

Mr. Foley of CMC continued, “We have built our bitcoin and ethereum cryptocurrency offering with our ‎clients in mind. Like all other financial instruments we offer, we always ‎recommend that clients understand the risks and conduct thorough research ‎before trading.”

Regulators Watching Closely‎

It’s an interesting time to enter crypto, especially with US futures flatlining and bitcoin’s price plummeting in recent weeks. Add to those last month’s Autorite des Marches Financiers intervention, effectively insisting such crypto derivatives will be regulated within the European Union’s MiFID II. It could mean strict business conduct standards, mandatory reporting, and many of financial products are barred from electronic advertising.

The fuss might be worth it, however, as “Plus500 said the hype around cryptocurrencies drew more customers to its trading platforms and the company forecast 2018 revenue ‘significantly ahead’ of market expectations,” Reuters reported.

Do you think CFDs are a good move for crypto? Let us know in the comments!

Images via Pixabay, CMC.

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What is Fishbank?

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